Making an offshore voluntary disclosure is easy. Slap together a few documents and you're done, right? Well, not so fast…preparation is the key. Putting together a sloppy voluntary disclosure will only lead to more problems. How? For starters, your submission will be reviewed by an actual human being.
Someone who has the potential to get frustrated if everything isn't where it should be. Trust me when I say, that's the last thing you want. We've learned that's something that can easily be avoided if the proper preparation and documentation is in place.
Having a positive OVDP experience when things start to get…complicated
One of the biggest success stories I've had with IRSMedic is in the development of something unique we made for our OVDP clients. For every voluntary disclosure we submit, we create a financial workbook. It's a database that consolidates all of our client's foreign accounts into an easily readable format. While it seems simple on the surface, it's anything but that.
My prior experience in banking helped me collaborate in creating this database. I'll spare you the details, but let's just say there were hours upon hours spent poring through bank statements, consultant notes, financial account summaries, and informational forms filled out by our clients. From all this documentation, we extract the most important information and transform it into an "OVDP bible" of sorts.
With the help of several colleagues, we redesigned and tweaked this workbook, almost on a daily basis. One of my very first experiences sharing this financial workbook with a client was with a fellow we'll call Tom Jameson. He and his wife were going through the full OVDP program, which involves 8 years of amended tax returns and FBARs.
With a total of over 35 accounts between the two of them, putting together this financial workbook was a daunting task. But to me, it was like putting together a puzzle and playing detective; it was a challenge I was ready to sort out. I soon discovered that this process, which involves an incredible amount of attention to detail, was extremely exciting to me! Mr. Jameson was pretty proficient with Excel and provided me with many of his own spreadsheets over the coming months; with all of the pieces I need, I was able to completely organize all of their accounts.
When we finally shared the finished product with Mr. Jameson, he was able to efficiently and accurately point out where information was lacking or inaccurate. The workbook prompted him to do some of his own research into various types of foreign mutual funds and how they should be treated on the U.S. Federal tax return.
In turn, this led to a very informative discussion between Mr. Jameson and our tax preparers regarding PFICs. Not only has this financial workbook allowed the IRSMedic team members to contribute a variety of different skills and expertise, but it's been a massive success for many of our other offshore clients. Having the experience and knowledge to compile the proper documentation for the IRS is the best way to be able to progress with confidence and certainty! For me, it's been incredible to see how one tool that I was able to help create is able to in turn create so many success stories.
If you need assistance getting into the proper disclosure program, contact us. We can help.
